A Boomer Concierge Strategy is Key to Growth

One of the first questions I ask credit unions in strategic planning meetings is, “Which segment represents the largest portion of your membership base?” The typical answer: “Older,” referring mostly to the baby boomers, people born between 1946 and 1964.

I follow that up with another question: “What member segments are you focused on attracting?” The overwhelming answer: “Gen Y/millennials.” With little prompting, I learn the reason. They feel a need to replace an aging customer base.

It has become clear to me that with this big focus on new members, credit unions are missing out on a huge, untapped opportunity with long-established members.

Granted, the needs of existing boomer members are different and generally less exciting than those associated with Gen Y, especially given all the hype surrounding multi-channel banking, payments and technology-led disrupters. But the credit union that wants to grow needs to protect its back door and maintain its existing membership base. If it doesn’t meet the needs of boomers, someone else will.

Think about the demographic. Baby boomers:

Are retired or trying to figure out when they can retire;

Worry about minimizing debt and accumulating assets;

Wonder about aging in place and are concerned about long-term care;

Will likely need supplemental healthcare insurance and the ability to navigate the nuances of the Affordable Care Act;

Hope Social Security has staying power while realizing it may not be enough to support them;

Need reliable steady income without volatility.

In effect, boomers need a plan.

From a strategy point of view, the development of a target member experience for boomers should be just as if not more important than attracting Gen Y. Successful credit unions will find a way to stop sitting on the sidelines, stand up and put every boomer in a great big bear hug. They will craft a set of services based not just on products but also on advice.

Best practice credit unions will incorporate these seven areas of focus into their “Baby Boomer Concierge Strategy”:

Price checking, savings and certificates designed in a way that rewards members for their depth of relationship – the more deposits, the greater the rate.

Include traditional offers as well as reverse mortgages as part of loan products, and ensure member service representatives know when it’s appropriate to discuss tapping into home equity and when it’s not.

Investment services and licensed advisors who are able to deliver an array of fixed income capabilities, from annuities to bonds, and help members craft financial plans.

Establish partnerships or CUSOs to offer supplemental medical, long-term care and other insurance.

In the spirit of the retirement advisor, position the credit union to provide member education on how and when to apply for Social Security, how to apply for Medicare and what to think about in terms of supplemental insurance. MSRs should be comfortable explaining the nuances and tax implications of transferring wealth to heirs.

Develop “retirement bankers.” Invest in the skills and technology required to train top performing MSRs in branches and the contact center to be effective concierges of all things retirement. These reps should be educated enough to either provide direct guidance or bring in specialists as needed.

Build out the technology tools to support the strategy. A few examples include:

Retirement sections within digital delivery channels;

Robust FAQs available online and in-branch;

Financial planning tools available to bankers and advisors;

Tablets or other devices to enable discussions and account opening at the member’s kitchen table.

Credit unions that can demonstrate the ability to be the trusted concierge in helping boomers make smart decisions as they live in or approach retirement will establish true credibility, deepen relationships and increase value to members. And don’t forget the bear hug – that warm embrace that tells boomers they are important members.